Kamis, 25 September 2014

NUMBER OF POOR IN INDONESIA COULD POTENTIALLY INCREASE

by Andi Abdussalam
          Jakarta, Sept 25 (Antara) - Records of the Central Bureau of Statistics (BPS) reveal that Indonesia was home to some 28.28 million poor people last March, higher than the 28.17 million recorded in the same period the year before.
         BPS Chief Suryamin said recently that the rise in the number of poor people could be attributed to the losses incurred by those working in the agricultural sector as the harvest season had been delayed due to unfavorable climatic conditions.
         A World Bank reported that  the rate of reduction of poverty and inequality in Indonesia had  declined, and was only 0.7 percent in 2012-2013. This was the lowest seen in the last decade.
         The World Bank has also reported that around 68 million people in Indonesia almost fell in the "poor" category as their income was marginally higher than that of those in the "poor families" category.
         According to Rizal Ramli, who was the Chief Economic Minister during Abdurrahman Wahid's term as president, there could be a further rise in the number of the poor if the incoming government raised the price of subsidized fuel.
        Ramli added that in addition to these 28.2 million, another 10 million people nearly fall in the "poor" category.  If the price of subsidized fuel is raised, it would lead to a hike in the cost of transportation and commodities as well as the inflation rate, leading to another rise in the number of poor. 
    "If the next government raises fuel prices, the number of poor people in Indonesia will most likely rise to 38 million," the former Chief Economic Minister stated.


Rabu, 24 September 2014

FATE OF GREEN CAR PROGRAM DEPENDS ON NEXT GOVERNMENT

By Andi Abdussalam
          Jakarta, Sept 24 (Antara) - About a year ago, the government's low-cost green car (LCGC) production program became a hot discourse following the rejection of Jakarta Governor Joko Widodo (Jokowi) who said it would worsen Jakarta's already serious traffic gridlock.
         He wrote to Vice President Boediono expressing his objection to the production of LCGC cars in Jakarta. Yet the government decided to go ahead with its inexpensive car production hoping it would help boost automotive exports and reduce the use of subsidized fuels.
         Now, Jokowi has won the presidential race and will be installed as the president of the country. Will the next government under Jokowi scrap the LCGC program? How will automotive manufacturers who have produced LCGC cars respond to it if the program is scrapped?
    "Businesses are flexible. They flow like water. If here the tap is tightened, they will flow to other channels," Gaikindo Secretary General Noegardjito said here on Wednesday.

         He said that he would not make too many comments with regard to politics, including the possibility of the LCGC program to be stopped by the next government under the Joko Widodo - Jusuf Kalla administration.
         "We will follow the (next) government if it scraps the program. We have been manufacturing LCGC cars also because we are following the (current) government's program," he said.

Selasa, 23 September 2014

SOME PARTS OF INDONESIA FACE WATER CRISIS

 By Andi Abdussalam
          Jakarta, Sept 23 (Antara) -  Residents of some regions and provinces in Indonesia have begun to face water crisis as the water volumes of springs, wells, rivers and lakes began to decline as a result of drought.
         The volume of the Cisadane River in Tangerang for example, has begun to drop drastically in the past few days.
        "The condition of the Cisadane River's water volume is categorically critical, though it still looks normal. Yet, its volume continues to decline," Sumarto, the head of Tangerang's Bendung Sluice 10 of the Cisadane River, noted on Monday.
         The Cisadane River is one of the main sources of water for industries and water companies which distribute water to consumers in Tangerang, Banten province.
         Provinces which have been affected by water crisis as a result of drought this year included South Kalimantan, East Nusa Tenggara (NTT), Central Java and West Sumatra. According to the National Disaster Mitigation Agency (BNPB), twenty provinces in Indonesia have been affected by the drought due to the current dry season and low rainfall.
         To deal with the situation, the BNPB has allocated Rp50 billion for relief operations in the regions affected by drought, including providing water tanks and pumps as short-term measures, BNPB spokesman, Sutopo Purwo Nugroho said.

Sabtu, 20 September 2014

POLICY MIX NEEDED TO CONTROL INFLATION

By Andi Abdussalam
          Jakarta, Sept 20 (Antara) - President-elect Joko Widodo, who will be installed on October 20, has said his government will increase the prices of subsidized fuel to bring down the quantum of subsidy burdening the state budget.
         Observers predict that fuel price hike will trigger inflation, otherwise supposed to stay this year in the range of 4.5 plus minus one percent.
         Bank Indonesia (BI), the Indonesian central bank, however said that it was not worried by the effect of any possible rise in inflation.
         "No need for too much concern (over this). It would be only a short term effect. In two or three months, conditions would be back to normal again," BI Governor Agus Martowardojo said.
         Agus said the government needs to raise the prices of subsidized fuels to keep the vital fiscal stats in a healthy condition. "Price adjustment is needed, considering the fiscal condition," he added.
         Bank Indonesia hoped that the prices of subsidized fuels would be raised before the US central bank, the Fed, begins to raise its interest rate, he said. The Fed Fund rate is expected to be raised in mid 2015. 
    Bank Indonesia will implement a stringent monetary policy by the end of 2014 to achieve the inflation target, improve the current account deficit, and will try to anticipate the impact of the global economic policies.


BI CALLS FOR FUEL PRICE HIKE TO PREVENT CAPITAL OUTFLOW

By Andi Abdussalam  
          Jakarta, Sept 20 (Antara) - Bank Indonesia (BI) has called on the next government to increase subsidized fuel prices before the US Federal Reserves raises its fund rate to prevent capital from flowing out of the country.
         "It would be better if prices are raised in the fourth quarter. But the increase must not go beyond February 2015," BI Senior Deputy Governor Mirza Adityaswara said.
         The deputy governor of BI, the central bank, said a price increase of subsidized fuels would reduce the risk of capital flight overseas, as it cuts the country's deficit.
         "Indonesia is facing the risk of capital outflow by foreign investors. The government should prevent this by improving the condition of its deficit. In the short-term, this could be done by cutting fuel subsidies," said Mirza Adityaswara in Jakarta on Friday, Sept. 19.
         He added that Indonesia still relies on foreign capital flow, so it should prevent capital outflow that could trigger turmoil in the financial markets.  The faster fuel prices are raised, the better it will be, he said.

Jumat, 19 September 2014

LIMITATION OF DIESEL OIL SALE AFFECTS FISHERMEN

By Andi Abdussalam
          Jakarta, 19 (Antara) - State-owned oil and gas company Pertamina's move to limit the sale of subsidized diesel oil has affected fishermen in North Jakarta's Muara Angke Traditional Fishing Port and cut their fish production by about 50 percent.
         Some fishermen at Muara Angke have, in the past two months, not taken out their boats for fishing due to scarce diesel oil. Some fishing vessels have had to wait for one month in queue to receive subsidized diesel fuel.
         Pertamina has been limiting the sale of its subsidized diesel oil in order to economize on the subsidized quota which, if its sale is not limited, will run out by December 6, 2014.
         Fishing vessels have to wait in queue up to one month since Pertamina limited the sale of its subsidized diesel oil last August.
         "This happens because the volume of diesel oil distributed to us is less than the need of fishermen at Muara Angke," Bagus Rudiyono, manager of Fishermen's Fuel Refilling Stations (SPBBN) in Muara Angke, said on Thursday.

Kamis, 18 September 2014

DRUG MONITORING AGENCY TO PROBE CIGARETTE MANUFACTURERS

 By Andi Abdussalam 
          Jakarta, Sept 18 (Antara) - The Drug and Food Monitoring Agency (BPOM) will investigate cigarette manufacturers that have allegedly violated regulations by not displaying pictorial health advisories on cigarette packets.
         Following up on a report by activists claiming that more than 50 percent of cigarette manufacturers surveyed did not display pictorial health warnings on their cigarette packets, the BPOM will begin monitoring packages.
         "We will cooperate with police in carrying out the examinations. If they are found guilty of violating regulations, they will be acted upon based on the law in force," Elly Mutiawati of the BPOM said on Wednesday.
         She noted that the BPOM has signed a memorandum of understanding on the supervision of food products and other goods, including cigarettes, which contain chemical substances and harm public health.
         "A comprehensive supervision and investigation should be carried out first, before taking actions against violators," Elly said.